Logistics-tech startupTiger Global Management and Sequoia Capital India, was started as The Porter in August 2014 by IIT alumni Pranav Goel, Uttam Digga and Vikas Choudhary, to change the fragmented intralogistics industry by leveraging technology.
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The Mumbai-based startup is a logistics market that enables companies to book vehicles on demand to meet logistics needs within the city. Porter currently works with e-commerce, FMCG, small and medium-sized companies, merchants, 3PLs, courier and freight companies. It has disrupted various logistics domains by launching an on-demand marketplace for light trucks and bicycles – Porter for Enterprise and Packers and Movers.
The bit of entrepreneurship was inspired by the founders “Uber for X” concept seven years ago to serve consumers with on-demand services.
The co-founders studied the business model for Uber and similar companies, which aggregated existing supply chains and matched it with demand in a much more efficient and easy way by using technology. The trio did basic research on logistics in Mumbai and found a huge market gap in the delivery space on the last mile.
Stock Photo by the Porter team (Image credit: Porter’s Facebook page)
When talking to Your storyPranav recalls that in 2014, the internal logistics industry was a very fragmented market with large gaps in demand and supply, poor matching and low asset utilization.
“With the existing challenges, the industry also lacked an ecosystem for the entire logistics cycle to function smoothly. It was clear to us that only a technical intervention can fix the gaps. That is why Porter was started to turn these challenges into opportunities and to take advantage of the promising logistics market in the cities of India, ”he adds.
The industry also had other challenges. Co-founder Uttam says that when they started Porter, they realized that there were major complications on the partner side.
“We have also unearthed some uncomfortable social stigmas, especially those related to the pain points of owning an LCV (Light Commercial Vehicle). It was this knowledge that changed how we decided to solve the problem,” he adds.
Vikas repeats the same and says that based on all these factors, the trio took a deep dive to understand the partner problems and then created a marketplace that would create an efficient and reliable ecosystem in the industry.
“While the company and its stakeholders must create an effective economic cycle, the larger purpose of Porter over the years has been to create a social impact that positively changes the lives of every stakeholder in this journey,” he adds.
He says that the spirit and commitment to disrupt the industry and create a social impact became their turning point.
The constant development
However, the eureka moment or turning point according to Pranav was to develop the startup into a technically enabled marketplace and create an ecosystem in this space from just being an on-demand marketplace, connecting customers to drivers and improving both their visibility and efficiency.
“It’s rare for start-ups to see their original essay played out,” says Pranav. “We were quick to realize that the major disruption in the industry was on the supply side and we need to shift our focus towards addressing these issues and thereby create a strong impact on the demand side. This resulted in creating a good cycle with strong network effects. The ecosystem “paved the way for increased vehicle utilization, better SLA (service level agreement) and higher income for its driver partners. From the smallest to the largest intervention, every step of our journey has been built around the ecosystem, with a strong focus on our supply side,” he explains.
According to the team, drivers earn 30 percent more and customers save 20 percent on logistics costs, and get a better experience with lower waiting times and higher availability.
Porter is also one of the only logistics models that is 100 percent easy to access and has a negative working capital cycle, according to the founders.
The startup, which was launched with two vehicles in August 2014, is now present in over 13 cities across India, with more than 50 lakh customers and over two lakh owner-drivers on board.
Porter also claims that they have consistently achieved triple-digit annual growth since launch, and have grown faster with the scale as the network effects unfold.